Operation of another unit of 1,320 MW coal-fired Payra power plant is going to be suspended soon due to coal shortage, according to Bangladesh-China Power Company (Pvt.) Limited (BCPCL) officials. The plant has two units each having 660 MW and the first unit of the two has already been shut following the coal crisis. "Now the remaining unit may run until June 2", said Shah Abdul Moula, plant manager of the BCPCL. BCPCL, a joint venture of the Chinese firm China National Machinery Import & Export Corporation (CMC) and Bangladeshi state-owned North-West Power Generation Company Bangladesh Limited (NWPGCL), is the owner and operator of the Payra power plant. Read more: IPPs call for uniform import duty on primary fuels The plant manager said that the plant is currently operating one unit having 660 MW while another 660 MW unit was closed last week. Moula said that the overdue payment against the coal import actually created this critical situation. The overdue amount now stands at more than $400 million. "But recently we received a permission from Bangladesh Bank to pay $50 million to the coal supplier against the overdue", he said adding that this will help arrange to resume coal import. Read more: Separate entity needed to deal with matters relating to coal: Energy experts But still it will take about a month to receive the coal supply and we hope we may not get before June 28, said another official of the BCPCL.  According to official sources, the Payra power plant needs to import 3 lakh metric tonnes of coal every month to operate the plant in full swing. They said the BCPCL normally opens LC through state-owned Sonali Bank to import the coal. But recently Sonali Bank regretted opening the LC due to the dollar crisis. Admitting about the problems, the BCPCL officials said the authority has already communicated the issue to the Power Division to take necessary measures. Read more: Committee to review existing deals on coal purchase for power generation Prime Minister Sheikh Hasina on March 21 last year inaugurated the 1320 MW ultra-supercritical coal-fired power plant at Patuakhali's Payra on a day when she also declared the country's 100 percent electricity coverage. This milestone achievement puts Bangladesh ahead of India and Pakistan among the South Asian nations to light up every house with electricity. BCPCL set up the plant using Ultra Supercritical Technology at over $2 billion as part of a development partnership on 982.77 acres of land. The Export-Import Bank of China lent $1.96 billion for the project. The company started operation in 2016. Read more: Bashundhara Group wins bid to supply 8 million MT of coal to Rampal power plant This kind of coal-fired power plant using Ultra Supercritical Technology is the thirteenth in the world and seventh in South Asia. The Ultra Supercritical Technology used for this plant aims at protecting the environment in line with the government's policy, officials said. After undergoing test runs for about five months, the first unit of the Payra power plant started commercial operation in May, 2020. In October, 2020, the second unit of the 660 MW plant, a joint venture of Bangladesh and China, started its commercial operation. The Payra and another 1320 MW Rampal power plants have been implemented targeting the power evacuation from both the two plants and transmit power to Dhaka city and adjoining areas to meet growing power demand. Read more: Illegal coal furnaces leave Khulna gasping for breath & answers The Payra power plant is burning some 13,000 tonnes of coal a day. It has a 76.30 acre dumping zone where 25 years’ worth of by-product can be kept. The plant is currently importing coal from Indonesia. It has its own jetty whose conveyor belts can unload 3,200 tonnes of coal every hour from four vessels at the same time. Bangladesh's power generation capacity reached 25,514 MW from just 3200MW in 2009, according to the data.

It has become essential to form a separate entity to deal with matters related to importing coal for both public and private power plants in Bangladesh. Some recent scams in coal price fixing made it even more necessary in order to protect the interests of the state, as there are various allegations against the coal-fired power plant operators. Energy experts are of the view that only a separate and strong state agency can work effectively in this regard. Officials of the state-owned Bangladesh Power Development Board (BPDB) would also prefer a separate entity to be responsible for both import of coal and also work as a monitoring body to check any untoward practices in coal purchase for the power plants. Also Read: Top policymakers briefed about outcome of meeting with Adani on coal pricing: Sources “Since coal is a pass-through item in power generation and the BPDB has to ultimately pay the bills, there should be a state-owned entity which will import the coal directly and monitor the price of coal to be imported by any private power plant operator,” a top official of the organisation told UNB, preferring not to be named.         Supporting the idea of forming a state-owned separate entity for importing coal and supervising any coal import by the private sector, eminent energy expert Dr M Tamim said such a body for coal is essential for Bangladesh, just like the Bangladesh Petroleum Corporation (BPC) exists for hydrocarbons. “We can form a body like Coal Bangladesh like Coal India in our neighbouring nation,” he told UNB. He noted the reality that Bangladesh does not have any experience in coal import. Also Read: Adani Group starts discussion with Bangladesh to resolve issues on coal pricing So if any company manipulates coal prices through underhanded dealing with suppliers, it will be difficult to identify such unfair means for non-experienced officials, he added.   The coal price issue came into the forefront in recent days following the unearthing of the Indian Adani Group’s power purchase agreement (PPA) with the BPDB, and controversies surrounding the steep purchasing price for coal quoted to BPDB by Adani Power. Adani Power recently sent a request for BPDB to issue the demand note, where the coal price was quoted at $400 per metric ton (MT) - far above what BPDB officials believe it should be given the present state of the international market. “In our view, the coal price they have quoted ($400/MT) was excessive - it should be less than $250/MT, which is what we are paying for the imported coal at our other thermal power plants," the official said. They mentioned that the price of coal is coming down in the international market. Also Read: Committee to review existing deals on coal purchase for power generation To adjust the coal price,  the BPDB sought a revision to the PPA it signed with Adani Power Ltd for importing electricity from its 1600 MW thermal power plant in Jharkhand, India. Against the backdrop of a heated debate over the issue, the government formed a review committee, headed by Power Secretary Habibur Rahman, to analyse the existing deals signed by the public, private and joint venture power companies, including the one with Adani, to import coal for use in power generation. The 9-member high level committee was formed on January 23 and its first meeting was held on February 20. Besides the Power Secretary, the committee also includes the Chairman of Bangladesh Power Development Board (BPDB), additional secretary of Power Division (coordination), representatives from the Prime Minister’s Office, Finance Ministry, and Commerce Ministry; the chief engineer (power generation) of BPDB, managing directors of the power generation companies, and the deputy secretary (development) of the Power Division, who will also act as member secretary of the committee. Read more: Rampal’s unit-1 to resume power generation Wednesday under 'test run' About the outcomes of the review committee meeting, Power Secretary Habibur Rahman said the committee needs to sit in more meetings. “It’s too early to give any substantial outcomes right at this moment…We need to hold more meetings”, he told UNB. Official sources said the review committee was formed following the report that Bangladesh will incur a financial loss of Tk 700 crore per month and Tk 8,400 crore annually due to the “faulty deal” signed with Adani Power to import electricity from its coal-fired 1600 MW Godda plant in Jharkhand state of India, first reported by UNB in January. The BPDB sent a letter to the Adani Group seeking a revision to the existing PPA following the request it received in relation to opening LCs (in India) to import the coal that will be used as fuel for the 1,600 MW plant in Jharkhand. Read More: Bashundhara Group wins bid to supply 8 million MT of coal to Rampal power plant The BPDB sent the letter date January 23 referring to State Minister-led delegation’s recent visit to the Adani plant mentioned, “During the discussion your side also opined that suitable mechanism will be devised to reduce this inconsistency of coal price by adjusting/changing the coal pricing mechanism of the power purchase agreement (PPA)”. BPDB officials alleged that the price of coal for the Patuakhali's Payra power plant was set at 15-16 percent higher than the market price in connivance with corrupt officials.